Both Three UK and Vodafone UK step up open RAN

Three UK this week became the latest mobile operator to dip its toes into open radio access network (RAN) technology through a new trial in Glasgow, with plans to eventually take “learnings” from the trial and apply them in other parts of the U.K.

The focus of the trial in the Scottish city is to test the capabilities of open RAN in delivering small cells in a dense, urban environment. The operator is deploying 20 sites in phase one of the 15-month trial, followed by another 31 sites in phase two. The first site will go live in the second quarter of 2024. 

The CK Hutchison-owned operator is collaborating with Mavenir, which is providing open RAN-compatible radio cells. Also involved are Accenture for test and measurement, Boldyn for site acquisition and deployment, PI Works for its automation platform, and engineering firm AWTG as project lead.

Notably, Three UK is also in the process of merging with Vodafone UK, which has already embarked on a much larger open RAN project.

Furthermore, Vodafone Group chief executive Margherita Della Valle confirmed on Monday that the operator has kicked off its previously announced request for quotes for open RAN technology across its entire global footprint of 170,000 sites, of which more than 100,000 are in Europe.

Della Valle observed that the RFQ is “said to be the largest radio network tender in the world” outside of China. She also revealed that United Arab Emirates-based e&, which now owns 14.6% of Vodafone, will participate in the procurement exercise as part of the duo’s strategic alliance formed in May 2023.

Urban focus

Three UK’s open RAN trial is modest in comparison with Vodafone’s ambitions, which sees itself playing a pivotal role in spreading the open RAN word and helping others to get on board.

However, it signals interest by another European player in the technology. Moreover, Three UK claimed this is the first U.K. test in a “densely populated, multi-vendor, urban environment” and asserted that a rural testbed environment “does not provide the necessary environment to reflect the potential roll out of open RAN in high traffic areas.”

During the Glasgow trial, the operator predicts a 61% increase in coverage in the small cell areas, and an incremental average increase in speed of 35%.

Elsewhere in the U.K., Virgin Media O2 has also selected Mavenir as its open RAN vendor as well as its prime integrator to help transition its network to a cloud-native, virtualized RAN (vRAN) architecture.

BT, which owns mobile operator EE, was initially not one of the most enthusiastic supporters of open RAN, but has launched a trial of Nokia’s RAN Intelligent Controller (RIC), in an attempt to show its commitment to the technology.

The U.K. government is also supporting the move toward open RAN, with an ambition to carry 35% of the U.K.’s network traffic over open and interoperable RAN architectures by 2030.

Single-vendor open RAN to dominate

Meanwhile, Three and Vodafone were not the only operators to announce open RAN news this week, with Verizon also indicating it has deployed more than 130,000 O-RAN capable radios.

At the same time, the Dell’Oro group published some open RAN research that caused ripples of interest throughout the sector, not only because of its market forecasts but also owing to its assertion that single-vendor open RAN, not multi-vendor open RAN, will dominate technology sales, at least initially. 

According to Stefan Pongratz, VP and analyst at Dell’Oro, single-vendor open RAN is expected to drive the lion’s share of the open RAN market. “Multi-vendor Open RAN is projected to account for 5% to 10% of total RAN revenues by 2028,” he said.

In comments emailed to Fierce Wireless, Pongratz said the open RAN movement “encompasses a broad range of technologies and architectures and as a result, the meaning of open RAN varies across the ecosystem.”

Broadly speaking, he said, “the industry is converging around a set of foundational pillars,” including open interface, intelligence, automation, vRAN/Cloud RAN, interoperability, multi-vendor, and more. “And since the upside is in most cases not enough to warrant ripping out not fully depreciated assets, this re-shaping the RAN journey will take some time and the priorities for the various building blocks will vary depending on multiple factors,” he said.

In some cases, Pongratz said, “operators might mix and match radio and baseband vendors from the start (multi-vendor RAN) while in other situations, starting with single-vendor RAN will make more sense. At the end of the day, the operators want to move forward on this journey, but they also can’t compromise on performance and [total cost of ownership/TCO].”

On the supplier side, open RAN “is not some kind of a magic architecture that will significantly change the competitive forces that shape this market. But it can be a door opener for the ones that can deliver on performance and TCO,” he added.

Larbi Belkhit, research analyst for 5G, 6G and open RAN at ABI Research, noted that Deutsche Telekom’s ‘O-RAN Town’ open RAN trial in Germany focuses on the multi-vendor environment.

“However, North America seems to be taking a slightly different approach for the time being, with mostly single-vendor approaches for AT&T and Ericsson. There is a concern that the single-vendor approach may undermine the goals of open RAN’s true multi-vendor interoperability, but we must wait and see how deployments develop,” Belkhit said. 

Growth ahead

In terms of the market’s development, Dell’Oro said open RAN revenues are on track to have declined in 2023. Looking ahead, Pongratz expects market conditions to remain challenging in 2024. “But we are also modeling both open RAN and vRAN to grow this year as the early adopter comparisons stabilize and activity with some of these new projects firm up,” he said.

Dell’Oro also believes the long-term forecast remains positive, with open RAN set to account for 20% to 30% of worldwide RAN revenues by 2028, up from 7% to 10% in 2024. While North America “stumbled in 2023,” it is set to lead the open RAN market over the forecast period. As for Europe, after a slow start the region’s open RAN revenue share is projected to nearly double between 2023 and 2028, the research firm added.

Belkhit has a similar view, saying that recent developments in North America “have validated our suspicions that open RAN will experience a ‘boom’ in 2024. AT&T’s deal with Ericsson was an extremely high-profile moment for the open RAN ecosystem, and we anticipate that in 2024 a strong uptick in announcements will take place.”

However, he warned that there is still some caution among operators, “most likely due to the unresolved front-haul debate in the O-RAN Alliance affecting Massive MIMO open RAN deployments. This is expected to be resolved in the first half of 2024, so expect an increase in open RAN announcements afterwards.”